All NewsFebruary 4, 2025

Stock Market Today: Stocks steady as China retaliates with new US tariffs

Check back for updates throughout the trading day

U.S. stocks edged higher in early Tuesday trading, amid downside moves for oil prices and the dollar, as markets reacted to the fast-changing dynamic on tariffs and the potential for a protracted trade war between the world’s two biggest economies.

Updated at 11:58 AM EST

Nvidia’s China problem

Nvidia shares are holding solid early gains heading into the mid-day session, but could face renewed China risks tied to Beijing’s retaliation to U.S. tariffs put in place by President Donald Trump. 

Reports suggest China regulators are set to revive a December anti-trust probe, tied to Nvidia’s $6.9 billion takeover of Melanox in 2020, as it looks to target U.S. tech companies in its response to Trump’s move to apply an extra 10% levy on all China-made goods. 

Nvidia is also fending-off accusations that its high-end chips found their way into the hands of DeepSeek, the China-based AI startup that emerged this month as a low-cost challenger to big tech hegemony despite export restrictions put in place during the Biden administration.

Nvidia shares were last marked 2.4% higher at $119.45 each, a move that still leaves the stock down more than 13.6% for the year. 

Related: Nvidia stock faces fresh China concerns

Updated at 11:18 AM EST

Palantir untamed

Palantir Technologies  (PLTR)  shares hit a fresh record high in early trading, pegging its market cap at just over $240 billion, following a stronger-than-expected set of fourth quarter earnings and bullish outlook tied to “untamed” AI demand. 

“There are some transformational tech stocks that come along every decade and change the landscape,” said Wedbush analyst Dan Ives. “Palantir is one of them and proved it for all the tech world to see last night.”

Palantir shares were last marked 25.3% higher in late-morning trading and changing hands at $104.92 each, a move that extends the stock’s six-month gain to around 336%. Shares hit a fresh intra-day high of $106.91 each earlier in the session.

Related: Analysts race to overhaul Palantir stock price targets after Q4 earnings

Updated at 10:07 AM EST

Jolted

Around 7.6 million jobs went unfilled over the final month of last year, the Labor Department reported its December Job Openings and Labor Turnover report, a weaker-than-expected tally that could suggest slowing employment momentum into 2025.

The so-called quits rate, however, held at 2%, indicating workers are still finding higher-paying jobs compared to their current positions, while the layoff was also unchanged at 1.1%.

Updated at 9:40 AM EST

Mixed open

The S&P 500 was marked 5 points, or 0.09% higher in the opening minutes of trading, with the Nasdaq rising 74 points, or 0.38% higher.

The Dow slipped 58 points while the mid-cap Russell 2000 index, which hit a three-week low during the worst of yesterday’s slump, was marked 2 points, or 0.11% higher.

Updated at 7:37 AM EST

Merck slump

Merck & Co  (MRK)  shares slumped to the lowest levels in more than two years in early trading after the drugmaker said weak sales of its HPV vaccine in China would erode its 2025 outlook.

Merck posted stronger-than-expected fourth quarter earnings of $1.72 a share on revenue of $15.6 billion, but said it would pause shipments of Gardasil to China, a move that would likely trim 2025 sales to between $64.1 billion and $65.6 billion. Analysts were looking for something in the region of $67.3 billion, according to LSEG forecasts.

Merck shares were marked 8.9% lower in premarket trading to indicate an opening bell price of $90.90, .

Stock Market Today

Tariff headlines dictated much of the market’s direction on Monday. President Donald Trump’s decision to impose import levies on goods from Canada, Mexico and China initially sent shares sharply lower, but they pared some of those losses following a 30-day reprieve for the U.S.’s two closest trading partners.

Goods coming from China, however, were hit with an extra 10% levy today, causing a quick and significant reprisal from Beijing, which slapped tariffs on crude oil, farm equipment and other key goods, and launched an antitrust probe into Google parent Alphabet  (GOOGL)  just hours before it reported fourth quarter earnings after the close of trading.

That’s raised the prospect of a tit-for-tat trade war, which has the potential to both disrupt global supply chains and stoke inflation, leaving the Federal Reserve with little option but to hold its lending interest rate steady until the impacts are fully understood.

President Donald Trump placed added tariffs on goods imported from China and plans to meet President Xi Jinping later this week.

Andrew Harnik/Getty Images

“It’s true that tariffs typically represent a one-off price adjustment that wouldn’t necessarily or durably impact the inflation rate,” said Lauren Goodwin, economist and chief market strategist at New York Life Investments. 

“However, tariffs are accentuating a larger trend towards supply chain movements – one that is prompting durable and capital-intensive investment in the U.S. and global economies.

“The question for investors and policymakers regarding inflation is therefore less about the initial impact of tariffs and more about the longer-term inflationary impact of supply chain reglobalization in response to a more volatile global business landscape.”

Related: Goldman Sachs analysts warn on Trump tariff impact for stocks

The market’s immediate reaction to last night’s pullback on tariffs aimed at Canadian and Mexican imports was to sell the U.S. dollar, which retreated from its two-year high against a basket of its global peers and was last marked 0.4% lower at 108.493.

Treasury bond yields, meanwhile, inched higher, with 10-year notes last pegged at 4.581% and 2-year notes trading at 4.259% heading into the start of the New York session.

Stocks remain under pressure, however, and look set for a third consecutive day of decline with the S&P 500 called 7 points lower at the start of trading and the Dow Jones Industrial Average priced for an 85-point pullback.

The tech-focused Nasdaq, meanwhile, is set for a 2-point decline, with early gains from Nvidia  (NVDA)  and Alphabet offsetting declines for Tesla  (TSLA)  and Microsoft  (MSFT) .

More Economic Analysis:

In Europe, the Stoxx 600 was marked 0.11% lower in Frankfurt as investors fretted over the potential for new levies from the White House on goods exported from the EU. Britain’s FTSE 100 was down 0.14% in London.

Overnight in Asia, Japan’s Nikkei 225 finished 0.72% higher in Tokyo, with the regionwide MSCI ex-Japan index rising 1.67%.

Related: Veteran fund manager issues dire S&P 500 warning for 2025